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Distributional and economy-wide effects of post-conflict policy in Colombia

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  • Jiménez Giraldo, Dora Elena
  • Saldarriaga-Isaza, Adrián
  • Cicowiez, Martin

Abstract

The aim of this paper is to evaluate the effects of agricultural policies that, as part of the peace accord in Colombia, have been proposed for the rural regions most affected by the armed conflict. Specifically, we are interested in their economy-wife and distributional effects. To that end, we use a newly built 2014 social accounting matrix for Colombia to calibrate an extended version of the well-known PEP 1-1 computable general equilibrium model. The policies we consider comprise an increase in total factorial productivity due to greater technical assistance and infrastructure construction, and production and employment subsidies in order to promote the substitution of illicit crops. It is found that value added, demand for labor, and factor incomes increase in the areas most affected by the conflict, while the opposite occurs in the other areas. Moreover, total rural income increases as long as the financing mechanism does not consider an increase in the taxation of rural incomes. In fact, we found that the distributional effects are strongly conditional on the financing mechanism that the government adopts.

Suggested Citation

  • Jiménez Giraldo, Dora Elena & Saldarriaga-Isaza, Adrián & Cicowiez, Martin, 2019. "Distributional and economy-wide effects of post-conflict policy in Colombia," Conference papers 333124, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:333124
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    More about this item

    Keywords

    Agricultural and Food Policy;

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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